30 Mar 2023
Conditions not met for further acceleration of state pension age increases
The government has announced that a mooted acceleration in the state pension age increase to 68 from 2037 will not be brought forward.
Our Chief Executive, Dr Carole Easton OBE, warns that rushing through future rises risks raising poverty levels if conditions allowing older people to continue working into their 50s and 60s are not met.
Work and Pensions Secretary Mel Stride has announced that there will be no changes in timelines for raising the state pension age to 68 until a further review of the state pension age was carried out after the next general election.
Currently the age at which the state pension is payable is 66, with plans to raise this to 67 by the end of 2028, and increase it again to 68 from 2044.
The minister said that further review is needed given the level of uncertainty about the data on life expectancy, labour markets and the public finances.
Dr Carole Easton OBE, Chief Executive at the Centre for Ageing Better, said:
“While we welcome the announcement by the government not to bring forward the timeline for increasing the state pension age to 68, the uncertainty around the state pension age timelines is unhelpful.
“There could be a case to be made for lifting the state pension age if people are living longer, are having good health in later life and if older workers have good employment options in their 50s and 60s. But currently these conditions are not being met and progress is deteriorating. Life expectancy has stalled, and is actually declining in some parts of the country, while people in the poorest areas can expect to live only 52 years in good health. Over a quarter of a million more older workers have left employment since the pandemic, many because suitable opportunities for work are not there.
“The government has a role to play in enabling people to have longer working lives by delivering on promises to improve flexible working, employer health support and targeted employment support to help those older workers who are struggling to return to work.
“The risks of being too hasty with raising of the state pension age are clear. Research Ageing Better carried out with the IFS shows that the number of 65-year-olds living in absolute poverty more than doubled in the two years after the state pension age increased to 66. There are currently 2.9 million pensioners with no private or workplace pension, and 1.3 million with no savings at all. Future increases should be delivered cautiously and with significant advance notice or risk plunging huge numbers of older people into poverty.
“Continued uncertainty on timelines is not helpful. We need long-term clarity so that people can plan well in advance for their retirement. We need a Commissioner for Older People and Ageing to enable better long-term planning for our ageing population. An independent commissioner would help the government manage major decisions like rises in the state pension age by involving older people, supporting individuals with preparing for future increases and balancing the needs of different groups in society.”
